Australia's hoax poet sets the literary establishment squabbling once more

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A hoax that rocked the Australian literary establishment 60 years ago is causing fresh controversy on the eve of publication of a novel based on the affair by one of the nation's leading writers.

Peter Carey's My Life as a Fake, to be published later this month, was inspired by the case of two young poets who persuaded a literary magazine to publish a parody of Modernist poetry that they wrote in one afternoon. The pair invented a fictional poet, Ern Malley, claiming he was the author of 16 works discovered by his sister, Ethel, after his death.

The poems were published in 1944 in Angry Penguins, whose editor, Max Harris, hailed Malley as "one of the most remarkable and important poetic figures of this century". The hoax was duly exposed, to the utter humiliation of Harris, and so scandalised was the literary world that the careers of the two poets - James McAuley and Harold Stewart - never recovered.

The protagonists have died, but their descendants are at war again, over who owns the concocted poetry. Curtis Brown, literary agents for McAuley's estate, are taking legal action against a publisher, Tom Thompson, who represents Harris's estate and claims that he was assigned copyright.

Curtis Brown is demanding that Mr Thompson withdraw an edition of collected Malley poems published by his company, ETT Imprint. Mr Thompson, meanwhile, is partly basing his copyright claim on a letter in which McAuley told Stewart in 1960 that he believed the fictional Ethel gave Harris all rights to the poems.

Fiona Inglis, managing director of Curtis Brown, said yesterday that the poets were stricken by guilt about ruining Harris's reputation. She said the letter was probably "part of the joke", but it also reflected the fact that neither man wished to profit from a scandal that damaged so many lives.

Ms Inglis said: "They had no idea that their hoax would blow up like that and hurt so many people." Carey, who won the Booker Prize for his last novel, True History of the Kelly Gang, has long been intrigued by the Malley affair. In his new book, he blends the two pranksters into one poet, Christopher Chubb, who invents the figure of Bob McCorkle to mock the pretensions of literary Australia. Carey's magazine editor kills himself.

While the Malley case was the basis of My Life as a Fake, Carey says it was a springboard for a novel that soars far beyond it. Curtis Brown says the New York-based writer plans to meet McAuley's widow, Norma, and his son, Michael, when he visits Australia to publicise the book.

The case, described by the Australian-born art critic and author Robert Hughes as "the literary hoax of the 20th century", continues to exert a strong fascination. Some Australians remain convinced that Malley really existed, and the poems have been judged to have literary value by poets including T S Eliot, who said he too would have been duped.

Michael Heyward, who wrote a scholarly book about the scandal, has called Malley "a legendary figure ... the only genuinely avant-garde writer in a country that has never sponsored a literary revolution". McAuley's later poetry made less impact than the pastiche, and Stewart was never again published in Australia, but the Malley works were republished and influenced a younger generation of poets.